Debt Relief Orders UK: Eligibility, Risks and Alternatives

Before you decide whether a DRO is the right route, it helps to compare the alternatives:

• Use the TRDG Budget Planner to work out your real spare income.
• If your debt repayments are unaffordable but you may not qualify for a DRO, read UK Token Payments: 8 Steps to Manage Debt Repayments.
• If you are comparing formal debt solutions, read Before You Sign an IVA: Hidden Risks & Better Options.
• If you have regular spare income and unsecured debts, read Debt Management Plans UK: How They Work, Risks and Better Options.
• If you want to understand bankruptcy as an alternative, read Bankruptcy in England & Wales: 2026 Guide & Alternatives.

A DRO can be the right answer for some people, but it should be compared properly before you apply.

A DRO is only available if you meet the qualifying rules.

You may qualify if:

• You owe less than £50,000.
• You have £75 or less spare income each month after normal household expenses.
• Your assets are worth less than £2,000.
• You do not own a vehicle worth £4,000 or more.
• You live in England or Wales, or have lived or run a business in England or Wales in the last three years.
• You have not had a DRO in the last six years that was not cancelled.

You will not usually be eligible if you are already bankrupt, in an IVA, subject to certain insolvency restrictions, or have a pending bankruptcy petition unless a court has referred you for a DRO.

National Debtline explains that you must meet all the qualifying conditions and that an approved intermediary sends the application to the Insolvency Service.

You cannot apply for a DRO on your own.

You need to go through an approved debt adviser, also called an approved intermediary. They will review your income, spending, debts, assets and circumstances before sending the application to the Insolvency Service.

National Debtline explains that an approved intermediary is a specialist adviser who is authorised to send your application to the Insolvency Service, and that there is no application fee to pay.

The official receiver then decides whether the DRO should be approved.

Before applying, you should gather:

• A full list of debts.
• Recent balances.
• Income details.
• Household bills.
• Essential living costs.
• Asset information.
• Vehicle details.
• Any letters from creditors.

The more accurate the information, the safer the application process becomes.

If your DRO is approved, most included debts are put on hold for 12 months. This is often called the moratorium period.

During that time, included creditors are not usually allowed to ask you for payment or take further action.

At the end of the 12 months, most qualifying debts included in the DRO are usually written off, as long as your circumstances have not changed in a way that affects your eligibility.

GOV.UK says you stop making payments towards your debts, including interest, for 12 months and that you will not need to pay the debts or follow the restrictions after 12 months.

Creditors included in the DRO are not usually allowed to ask you for payments during the 12-month period.

However, you may still receive annual statements, arrears notices or default notices in the required format. That does not automatically mean the DRO has gone wrong.

National Debtline explains that creditors will usually have to keep sending annual statements, arrears notices and default notices under the Consumer Credit Act during the moratorium period.

If you receive letters demanding payment for a debt included in the DRO, tell the creditor about the DRO and contact the official receiver or your debt adviser.

Most types of debt can be included in a DRO, as long as your total qualifying debts are within the £50,000 limit.

Debts that may be included can include:

• Credit cards.
• Store cards.
• Personal loans.
• Overdrafts.
• Buy now, pay later debts.
• Benefit overpayments.
• Council tax arrears.
• Utility arrears.
• Rent arrears.
• Money owed to family or friends.
• Some HMRC debts.

National Debtline says you should include priority debts in a DRO, but you still need to understand how certain debts, such as rent arrears, may affect your housing position.

Some debts cannot be written off by a DRO.

These may include:

• Magistrates’ court fines.
• Child maintenance and family court debts.
• Student loans.
• Budgeting loans and crisis loans.
• Criminal confiscation orders.
• Some personal injury debts.
• Debts secured against assets.

You still need to list excluded debts in the application, but you remain liable to pay them.

National Debtline explains that some debts do not count towards the £50,000 DRO threshold but still need to be listed and paid in full.

A DRO stays on your credit record for six years.

This can make it harder to get credit, a mortgage, car finance, some phone contracts, or certain financial products during that period.

GOV.UK says your DRO will stay on your credit record for six years.

Even after six years, some lenders may still ask whether you have ever had a DRO or been insolvent, especially for larger borrowing like mortgages.

That does not mean a DRO is always wrong. If your debts are unmanageable, your credit file may already be badly affected or heading that way.

The key is understanding the impact before you apply.

Yes. If your DRO is approved, your details are added to the Individual Insolvency Register.

GOV.UK says a DRO is added to the Individual Insolvency Register and removed three months after the DRO ends.

National Debtline explains that the register can include details such as your name, address, date of birth, type of insolvency solution and when it started.

If publishing your address could put you or someone living with you at risk of violence, ask your approved intermediary about a person at risk of violence order before the DRO application is submitted.

If your circumstances change after you apply for a DRO, you must tell the official receiver.

This includes changes such as:

• An increase in income.
• Moving address.
• Coming into money.
• Finding out about an asset.
• Realising a debt was missed from the application.

National Debtline explains that if your circumstances change so much during the moratorium period that you no longer meet the criteria, your DRO may be revoked.

If a DRO is revoked, the protection ends and creditors may be able to take action again.

A DRO may be worth considering if:

• You live in England or Wales.
• You cannot afford to repay your debts.
• Your qualifying debts are within the limit.
• Your assets and vehicle are within the rules.
• Your spare income is £75 or less each month.
• You have no realistic way to repay the debts in a reasonable time.
• You understand the restrictions, public register and credit file impact.

For someone with low income, few assets and unmanageable debts, a DRO can offer a fresh start.

But you still need to apply through an approved debt adviser and check whether it is suitable for your full circumstances.

A DRO may not be right if:

• Your debts are over the limit.
• Your assets are over the limit.
• Your vehicle is worth too much.
• Your spare income is above the threshold.
• You have debts that cannot be written off.
• Your tenancy, job or immigration position could be affected.
• You are likely to receive money, inheritance or a large back payment soon.
• You need a solution that includes secured debts.

If you do not qualify, it does not mean you are out of options. It just means a different route may fit your situation better.

Before applying for a DRO, compare it with:

Token payments
Useful if you have very little spare income and need to make small affordable payments while stabilising your situation.

Debt Management Plan
May be useful if you have regular spare income and want one monthly payment towards unsecured debts.

IVA
A formal insolvency solution that may suit some people, but it has serious risks and should not be rushed into.

Bankruptcy
A formal solution that may be more suitable than a DRO in some situations, especially if debts or assets fall outside DRO limits.

Breathing Space
May give temporary protection while you get debt advice and decide what to do next.

A DRO may still be the right route, but it should earn its place after you have compared the alternatives.

Is a DRO free?
Yes. GOV.UK says you do not need to pay for a DRO. You still need to apply through an approved debt adviser.

Can I apply for a DRO myself?
No. You must contact an approved debt adviser. They review your situation and send the application to the Insolvency Service if a DRO is suitable.

How long does a DRO last?
A DRO usually lasts 12 months. This is the period where included debts are put on hold and restrictions apply.

Does a DRO affect my credit file?
Yes. A DRO stays on your credit file for six years.

Will my name be public?
Yes. Your DRO is added to the Individual Insolvency Register and is usually removed three months after the DRO ends.

Can creditors still send letters?
Yes, you may still receive statements and statutory notices. That does not always mean something has gone wrong. Payment demands for included debts should be queried.

What happens if I forget a debt?
If a debt is left out, it cannot usually be added later. The creditor may continue action, and if the missed debt takes you over the limit, the DRO could be at risk.

What if my income increases during the DRO?
You must tell the official receiver. If your circumstances change enough that you no longer meet the rules, the DRO may be revoked.

The Real Debt Guy has completed the DipFA Level 4 qualification and shares general debt and money education for UK consumers.

This article is for general information and education only. It is not personal financial advice, regulated debt advice, debt counselling or debt adjusting.

The Real Debt Guy is not FCA authorised. The Real Debt Guy is a letter-drafting and administrative support service. If you need advice about your specific circumstances or want to apply for a DRO, speak to an approved debt adviser or an FCA authorised organisation.